You will verify the licence and custody arrangements of every brokerage account you hold, using official registers.
You have a list from lesson 1.1 with the legal entity behind each account, and from lesson 1.3 you know which protection scheme should apply. So far, though, most of that came from the broker's own app and website. A broker telling you it is licensed is a claim. This exercise checks the claim against official registers and the documents you signed, and it takes about 25 minutes for two or three accounts.
Work through one account at a time, from the first step to the last, before starting the next. Hakim's bank brokerage is used as the worked example, with his international broker added at the end where the steps differ.
Go to the MAS website and open the Financial Institutions Directory. Search for the exact legal entity name from your account agreement, not the brand on the app. Brands and entity names often differ, and a search on the brand can return the wrong company.
When you find the entity, note the licence or status it holds and the date of the search. For a broker dealing in shares and ETFs, you would expect to see a capital markets services licence covering dealing in capital markets products, or an exemption that MAS lists, as banks often deal under their banking licence. Write down exactly what the directory shows, in its words.
Hakim searched the entity named on his statement, found it listed, and noted its status and the date. That line took him three minutes.
If the entity is licensed overseas, as it may be for an international broker, it may not appear in the MAS directory at all. Then search the home regulator's register instead. Each major regulator publishes one on its website. Note the regulator's name, the register entry and the date.
MAS keeps an Investor Alert List of unregulated persons that may have been wrongly perceived as licensed or authorised by MAS. Search it for the brand name and for any close variations, such as the brand with an extra word or a slightly different spelling. Scam sites often copy the name and look of real brokers.
A clean result does not prove a firm is safe, because new names appear all the time. A hit on the exact name or a near match is a reason to stop and check you are on the real broker's website before you log in or transfer anything.
Open the client agreement. Most brokers make it available in the account settings or the legal section of their website. Search inside it for "custody", "custodian", "nominee", "client assets" or "segregation".
You are looking for three answers. Where are your securities held, and by which custodian? In whose name are they registered: yours, the broker's nominee, or the custodian's? And how is client money held, for example in a trust account at a named bank?
Hakim found that his SGX shares settled into his own CDP account, so they were in his name. His US shares, bought through the same bank brokerage, were held by a custodian in a nominee account. One account, two custody arrangements, exactly as lesson 1.2 warned.
If you cannot find the answers, email the broker's support team and ask for them in writing. Save the reply.
Find out how you would move your shares to another broker without selling them. Search the help pages for "transfer out", "outbound transfer" or "move shares". For SGX shares held in CDP, a change of broker is simple because the shares are already in your name. For overseas holdings with a custodian, the broker may support a transfer to another custodian, charge a fee per holding, or not support transfers at all.
Note the method, any fee, and anything that cannot move. Fractional shares, which lesson 6.3 covers, often cannot be transferred and would have to be sold first.
Your broker check sheet has one row per account with these columns: legal entity, regulator and licence evidence, Investor Alert List result, custody arrangement for each market, protection scheme, and transfer-out method. Hakim's first row read like this, in plain words: his bank's brokerage entity, listed in the MAS directory with the status he copied and the date of his search; no alert list matches; SGX shares in his own CDP account, US shares with a custodian in a nominee account; MAS segregation rules, with SDIC covering only his linked savings account; SGX shares movable through CDP, US shares transferable for a fee per holding.
His second row, for an international broker, took longer. The entity was licensed overseas, so he searched that regulator's register and wrote down its scheme from lesson 1.3. The transfer-out page said fractions could not move. He marked that cell in red.
Any cell you cannot fill is a finding. Write the question you would send the broker in the cell, and send it. Now fill in your own sheet, one account at a time, using the official registers and your own agreement rather than memory.
Complete the broker check template for every account, with licence evidence, custody arrangement, protection scheme and transfer-out method.
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